WTO NEWS: SPEECHES — DG PASCAL LAMY
“Developmental and Trade Significance, Changing Context and Future Prospects” — Geneva
Ladies and gentlemen,
Welcome to this Symposium on the Agreement on Government Procurement
(“the GPA”).
There are several reasons why it is appropriate to hold an event such as
this at the present time. The economic crisis has reminded us that
markets require adequate governance mechanisms, if they are to function
properly.
While needless or excessive regulation should obviously be avoided, the
mere removal of obstacles to trade may not, by itself, ensure optimal
performance if rules are not in place to ensure fair procedures,
appropriate transparency of markets, and responsible competitive
behaviour that is environmentally sustainable. It is time to recognize
that such rules are an essential counterpart to market opening.
The GPA is a paradigm example of a trade opening instrument that also
recognizes the need for governance mechanisms — in this case, the
procedural rules that Parties to the Agreement must follow to ensure
fair and transparent contracting practices and the domestic review or
bid challenge mechanisms that the Agreement requires all Parties to put
in place. These rules and enforcement mechanisms are built around the
WTO's fundamental principles of non-discrimination, transparency and
procedural fairness.
Currently, the GPA appears to be in the process of taking on relatively
greater importance in the constellation of the WTO Agreements. I say
this in light of: first, the gradually growing membership of the
Agreement, and the negotiations that are now under way concerning the
future accession of important developing and transition economies;
second, the importance that public infrastructure spending has taken on
in the context of the economic crisis, as an element of many countries'
recovery strategies; third, related concerns over the implementation of
buy-national policies by some countries during the past year, and the
significance that these could take on as a barrier to trade; and fourth,
and possibly most important, the progress that has been made on
procurement reforms in many non-GPA Parties, which may be bringing them,
over time, closer to being ready to consider GPA accession.
With respect to accessions to the Agreement, I am pleased to learn that
Armenia has circulated a revised accession offer just this week, and has
asked that it be considered on an expedited basis. Clearly, also,
India's request for observership in the Committee on Government
Procurement, which I understand was approved yesterday, is an important
development for the Committee and for the Agreement.
Concerning the reforms that have been undertaken in many developing and
transition economies, these have, in turn, been encouraged by policies
and initiatives of multilateral and regional lending institutions which
are aimed at facilitating greater reliance on national procurement
systems as a vehicle for the delivery of development assistance. In this
regard, I see an important synergy between the work of these
organizations and the aims and modalities of the GPA.
The Symposium today and tomorrow will also be an opportunity to examine
together the highlights of the revised GPA text, which has provisionally
been agreed, but is pending entry into force once the coverage
negotiations are completed. Perhaps, the arrangement that was announced
last Friday between Canada and the US, which will involve Canada's
listing of previously uncovered sub-central government entities in its
GPA schedules in return for reciprocal benefits from the US, will help
to facilitate movement in the coverage negotiations more generally.
The revised GPA text preserves the main elements and principles of the
1994 GPA, but it updates the text, streamlines it in important ways, and
introduces new flexibilities for Parties that are made possible, for
example, by the use of electronic procurement tools.
The revised text also includes new transitional measures for acceding
developing countries that are more specific and concrete than those
offered under the existing Agreement. The above clearly plead for a
rapid entry into force of the revamped GPA.
Beyond this, there is an array of intriguing and challenging issues
concerning national procurement policies and international coordination
of such policies that will require the attention of GPA Parties and
other WTO Members in the years to come. These include matters such as
the treatment of environmental policies in relation to the GPA. Ensuring
environmental sustainability is a challenge that cuts across all areas
of national and international policy-making. The revised text of the GPA
already clarifies the scope for application of technical specifications
to promote the conservation of natural resources and protect the
environment. I understand that, in the course of the Symposium,
consideration will be given not only to these provisions but to the
question of sustainable procurement more widely and how it can best be
promoted consistent with international rules.
Another issue which is worth looking at is the articulation between the
GPA and provisions on government procurement in regional trade
agreements. The majority of the regional agreements that have been
notified to the WTO in recent years contain at least some provisions on
government procurement, and a good number, by one, admittedly
provisional, count, 37 of 138 agreements notified since the year 2000
contain detailed provisions on procurement.
An innovative aspect of the revised GPA text is a new provision relating
to the conduct of procurement, and the avoidance of conflicts of
interest and corrupt practices. This will be explored in one of the
panels of this symposium, together with the harm that can be caused by
collusive tendering practices among suppliers and the ways that these
can be deterred and addressed through national legislation. This is
clearly an area where there are strong complementarities between trade
opening and national competition policies.
Considering the range of issues to which the GPA relates and the nature
of the Agreement itself, it seems to me that this is a paradigm example
of an area in which good policy requires not only the removal of
barriers to efficient international competition, but also the creation
of appropriate rules and institutions to govern trade and competitive
behaviour. The challenge for all of us is to ensure that these rules and
institutional provisions are up to date and in tune with commercial
realities, while ensuring good governance for citizens.
To be sure, the WTO is not the only organization addressing these
questions at the international level. I am pleased to see that UNCITRAL,
whose Model Law on Procurement is complementary with the GPA in
important ways, is part of the programme. We also look forward to the
comments and observations of other participating intergovernmental
organizations that are present, including the World Bank, UNCTAD, the
International Trade Centre and the European Bank for Reconstruction and
Development, and those of the various non-governmental organizations
that have been invited to observe the proceedings.
This concludes my opening remarks. I am delighted that so many of you
are present for the Symposium and look forward to hearing the reports of
your discussions.
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